For years the biggest selling point for switching to solar power was the environmental benefits, but now business owners are finding it is also becoming better for the bottom line.
There is currently a global supply glut of solar panels. Along with improved efficiency and more competition, the price has dropped to where it’s more attractive for businesses trying to save money on power, said Dana Brandt, founder of Ecotech Solar in Bellingham. That has led to new commercial deals for Ecotech, including the upcoming installation of what will be the largest solar system in Whatcom County: Later this year the company will be installing a system at Irongate Machine that will be about four times bigger than the one on the roof of the Community Food Co-op’s Cordata store, Brandt said.
The new system, which will go on the south-facing side of the roof, will save the machine shop about $12,000 a year in electricity, making the investment pay for itself in about five years, said Kerry Byford, co-owner of Irongate Machines. When he first looked into solar panels several years ago, it took about 14 years to recoup the same investment.
“I think a lot of business owners with large, flat roofs will be taking a closer look at this,” Byford said.
The direction the solar industry takes in the next few years will affect Whatcom County’s economy because of several growing businesses in the area directly tied to it. Along with Ecotech, which installs the systems and has around 10 employees, the county is home to two significant solar system manufacturers: Itek and The Alpha Group.
Itek, which employs 85 people in Bellingham, is in negotiations to occupy a former GP waterfront building at 800 Cornwall Ave. If the new deal with the Port of Bellingham is finalized, it will triple the size of the company’s space to about 48,000 square feet and mean new equipment and more employees, said Karl Unterschuetz, Itek’s director of business development. He expects the deal to be finalized soon and hopes to be in the larger building next spring.
The move into the bigger space will be a key step toward entering the national and global market. The company currently makes its panels for customers on the West Coast. Unterschuetz said current market conditions have created a big opportunity to take the next step as a company. While there is a glut of panels, the market itself is growing and demand could pick up if those prices remain low.
“In the next couple of years we expect to grow rapidly as we enter a growing U.S. market,” Unterschuetz said.
Trade associations also share an optimistic view of the U.S. solar market. A recent report done for the Solar Energy Industries Association predicts the national solar market will grow 119 percent in 2016. Some factors for the increase include the rollout of new community solar programs and increased interest from the commercial sector.
Along with the Irongate Machine project, Ecotech Solar is installing a similar size system at the Chandler’s Square Retirement Community in Anacortes. Both projects are bigger than any other solar panel system north of Seattle, Brandt said.
Ecotech and Itek were also recently involved in putting a 48-panel solar array on the Bellingham Food Bank. As part of the Solarize Whatcom campaign, the panels were donated by a variety of companies and residents. Early estimates predict the food bank will save $1,300 a year in power costs.
Prior to this uptick in commercial interest in solar panels, Brandt said much of their work came from residential projects. In the past, residential installations made more sense from a financial standpoint because they had more tax incentives than commercial systems, Brandt said.
Why Whatcom County?
With its rainy weather, Whatcom County would seem like an unlikely hub of solar panel production and activity. Brandt points out that while the area has less sunlight in the winter, the 16-hour days of sunlight in the summer quickly build up credits for customers.
Unterschuetz agreed, adding that Whatcom County’s climate has other positives for collecting solar energy. He said the panels tend to work better in cooler, sunny weather compared to a dry desert climate. The air is also clean here and the rain helps.
“(Collecting solar power) between November and January is terrible, but the rain keeps the panels clean,” Unterschuetz said.
For Irongate Machine, cutting into its power bill is a major cost savings. The company, which employs 21 people, uses a lot of electricity making a variety of equipment, mostly for the food processing industry.
Byford said he became intrigued by the idea of solar power while attending Western Washington University and seeing the construction of a solar-powered car at the Vehicle Research Institute. The tipping point for him was not just the lower costs for the panels but also the tax incentives that are in place for commercial users. He said he would prefer to see solar power reach a point where it doesn’t need subsidies.
“I think the technology is great and right now the tax advantages are great,” Byford said.